Letter blasts lobbying against federal health care reform

By Ray Gronberg

gronberg@heraldsun.com; 419-6648

DURHAM -- A trio of local legislators have joined 17 of their colleagues in asking the state's attorney general and insurance commissioner to investigate Blue Cross and Blue Shield of North Carolina's lobbying against federal health care reform.

Rep. Paul Luebke, D-Durham, Rep. Verla Insko, D-Orange, and Sen. Ellie Kinnaird, D-Orange, signed a letter complaining about the nonprofit's use of mailers and automated "robocalls" to solicit opposition to the reform bills now pending in Congress.

The group consisted of 19 Democrats and one Republican, state Sen. Stan Bingham of Davidson County.

It looks like Blue Cross is "engaging in a blatant political campaign utilizing the premiums paid by their customers," they and their colleagues said in a letter dated Tuesday. "Even if there is no apparent violation of existing statutes, we think this is bad public policy that deserves further scrutiny."

The move built on a request earlier this month from Rep. Pricey Harrison, D-Guilford, that has already sparked a look by state Attorney General Roy Cooper into whether Blue Cross violated the so-called "do not call" rule that limits unwanted phone solicitations.

Blue Cross spokesman Lew Borman said the company has received an inquiry from Cooper's office and is "fully cooperating."

He added that company officials believe they're within their rights to speak out in the issue.

"We have said, from the beginning, that we believe it's important that North Carolinians understand the impact a government-run health plan and increased taxes could have on their health-care choice. We believe we have a right to participate in the debate."

The company's opposition is to proposals from Congress and President Barack Obama's administration for the creation of a so-called "public option," basically a government-offered basic insurance plan that would stand beside private-sector offerings.

Blue Cross officials in the mailings they sent out last month said passage of a bill including that would be "a slippery slope to a single-payer system" where the federal government covers everyone's bills.

Insko -- co-chairwoman of the N.C. House's Health Committee -- said she signed the letter because she believes "a good bill is being threatened."

She added that state employees, a key interest in her district, "feel like the money they pay for their policies was used to lobby for a position they oppose."

Luebke, senior chairman of the N.C. House's tax-writing Finance Committee, said he signed after hearing complaints from constituents.

"They have views different than Blue Cross Blue Shield and don't think that Blue Cross as a nonprofit ought to be taking a position on the bill," he said. "I agree with them."

By way of example, the company's first round of mailings sparked numerous complaints from residents of the Watts-Hillandale neighborhood in Durham, Luebke's home base.

Residents took to the neighborhood's e-mail list to gripe that the company was lobbying against the reform bill even as it was raising annual premiums by figures ranging in individual cases from 11 percent up to 26 percent.

The increases went over poorly because amid the recession, overall inflation rates reported by the federal government have been flat or actually negative for much of 2009.

Blue Cross also holds a near-monopoly on individual policies in this state and dominates the market for comprehensive group policies.

Overall, it wrote nearly $4.3 billion worth of health policies and reported net income of nearly $158 million in 2008, according to figures from the N.C. Department of Insurance.

Insko signaled Tuesday that she agrees with reform backers who argue that health care insurance is claiming so large a share of personal, family, corporate and national income that it's become a drag on other sectors of the economy.

"Our country cannot maintain its position in the world if we don't solve this problem," she said. "It's too big. It's taking too much of our money."

The legislators' criticism of Blue Cross, however, put them at odds with one of the area's largest private-sector employers.

According to the Research Triangle Regional Partnership, Blue Cross as of February employed 4,033 people, 18th highest among all employers in this region. In past years about a quarter of the company's work force has been based in offices in Chapel Hill, the rest in Durham.